Ahead of the end of the 5 per cent reduced VAT rate for the hospitality…
Chancellor Rishi Sunak new support schemes designed to help businesses and their staff in England under COVID-19 tier restrictions have been welcomed by UKHospitality’s chief executive Kate Nicholls. However, in Scotland, worries are increasing.
Nicholls, who met with him before the announcement, tweeted afterwards: ‘Huge and very welcome intervention by Chancellor – JSS scheme evolves significantly to reflect changed circumstances.’
She expressed hope that it had ‘Just saved hundreds of thousands of jobs in hospitality and supply chain. Crucially securing help for our teams but also giving biz a lifeline to remain viable through continued trading where possible and a quicker and easier return to growth as restrictions ease. Thanks for listening and continuing to support the third largest employer.’
This was in response to a HoC statement by Sunak during which he said the clear impact of restrictions on the hospitality sector were worse than they planned for. The grant system for businesses in any tier, whether forced to close or not, is to be extended. Retrospective cash grants of up to £2,100 a month can be backdated to August for businesses under enhanced restrictions.
The Job Support Scheme will see government cover the full cost for employers paying two-thirds of people’s salaries in tier 3 areas, where they are unable to work for a week or more. And the hours an employee needs to work to qualify for JSS is to be cut from a third of normal hours to a fifth, with employer contributions also cut.
Sunak also intends to increase help for the self-employed, doubling income support from 20 per cent to 40 per cent of their usual income.
However north of the border, UKHospitality Executive Director for Scotland Willie Macleod was greatly concerned by the announcement that restrictions for hospitality businesses there are to remain for a further week.
He said: “This is another catastrophic blow for Scottish hospitality. It is becoming increasingly difficult for businesses to keep pace with the constant change in the restrictions they are operating within.
“Many of these businesses are barely hanging on. They have had their revenue strangled or shut off altogether and many will have little or no cash in reserve. Extending the restrictions for another week could finish off those businesses that had just about managed to formulate a plan to see them through the initial lockdown.”
“The support on offer isn’t going to be enough to save the sector. The £40m announced by the Scottish Government was intended to cover a 16-day period to 25 October. That sum was inadequate when it was announced, and it is only going to be diluted further.
“Businesses are going to go under and take valuable jobs with them. It is now vital that the Scottish Government outlines plans for additional support to keep the sector from being totally wiped out.
“We are expecting an announcement tomorrow on the Scottish Government’s proposed tier system. That needs to be accompanied by a confirmation of how it intends to support businesses that continue to be hammered and some indication of the route map for businesses during these uncertain and distressing times.”